nextny

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Facebook’s approach to data and analytics

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Saw a really interesting post on insidefacebook (a blog I may be reading more in the future) which features a tech talk given at Yahoo! by Facebook's Jeff Hammerbacher on Facebook’s approach to data and analytics. It's almost surprising that the analyst people within Facebook say "Don't collect data without a purpose."  It's expensive and time/resource intensive, when it seems like everyone is 1)afraid that FB and Google are doing nothing but collecting data and  2) this is not for the good.

I think most of the insight is in the "Philosophy Slide" and when Jeff talks about that.


I wonder: does this mean that even if they could spy on us, it's just too resource intensive?  I bet it won't be for long.

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nextny 2 years later and nextAnalytics

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A personal reflection on the last two years: nextNY was really quite helpful. I first heard about nextNY in February 2006 when I was looking for a new job, back when the NY Tech Meetup had fewer than 200 people attending.

Since then I've helped organize a few events, found a new job, and learned a lot of new things.  One of those things has been web analytics. 

So, I've decided to see who else within nextNY is struggleing with these issues, and what we can learn from each other, for the benefit of clients, financial backers, employees and partners. 

Check out the event wiki.

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The End of the Diversified Media Company?

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How valuable is is to have assets over a variety of businesses?  Do economies of scale and especially scope really exist?  I think it is interesting what is happening this week.

Previously I blogged about IAC breaking up- essentially this is a vote for "yes" and a vote for "no" because the breakup into five separate companies suggests that the value of the parts individually is higher than the value of the whole.  Barry Diller also said that IAC

needed [the transactional businesses like Ticketmaster] earnings to allow us to invest in emerging Internet businesses. Now that we have real scale in the pure Internet units, it makes nothing but sense to me to reorganize the whole.

So essentially, having TV, internet, real estate, and retail assets all together under one roof wasn't maximizing shareholder value after all.


CnbcNbccom What are other firms doing?  Try GE. General Electric's NBC Universal unveiled a sweeping campaign last night during the Sunday Night Football broadcast of the Eagles-Cowboys game aimed at  "entertaining, informing and empowering Americans to lead greener lives."  But was anyone watching?

I would be surprised if this was not one of the top games in ratings this season.  The campaign, NBC Green is Universal, will turn the NBC logo on virtually all of its TV channels (cable and broadcast) Internet properties(excluding MSNBC),  green for one week to coincide with eco-awareness programming.  I don;t know what Matt Lauer was doing near the arctic circle, but apparently the earth is getting warmer :)  It's "Green Week" at Claire's high school on Heroes. 

The models on Deal or No Deal will be  wearing recycled parachutes.  Jay Leno shows you how to clean a green sink in an eco-friendly way.  Even as CNBC was reporting that Citigroup stock was probably headed lower, there was Eco-Awareness brought to you by NBCU. GE announced this on October 23, apparently.

It's going to be hard to avoid all of this, as NBC is everywhere, but I think the only thing this proves is unified campaign launches across platforms can be done well, with the added benefit that we decide to tell all our bosses to buy that $2,000,000 GE HVAC unit for the office park because it's 20% more efficient and uses 16% renewable resources (i made those figures up- all of them).  GE  named Ann Klee Vice President for Environmental Programs today!  All this seems more to be happening for corporate PR value and brand equity than any DR/commerce advertising.

Times are just as challenging for other large media companies.  The AOL/TW merger never produced the kinds of scale and scope ecomies and leverage promised to investors. Viacom spun off CBS radio in an apparent loss of faith  in the radio business's  fit with its other assets. 

Maybe all of these are examples of businesses with strong positions but weak strategic frameworks.  Are software/tech companies like Microsoft and Google doing this better than others?  In some sense, it seems like their model isn;t much different- using a cash cow (Windows OS/office software for Microsoft, search for Google) to lever into other lines of business.  Time will tell.

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follow up on NextMadison Ave: Book recommendation

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At NextMadisonAve Michael Hurt from Microsoft suggested that people take a look at Porter's Strategy, which is largely viewed as a definitive work on corporate strategy.  For a really interesting look at why some strategies succeed and others fail, especially when it comes to new technologies, I would suggest folks check out Michael Raynor's The Strategy Paradox, which includes in particular a discussion of why Microsoft has been so successful over the years.

Mr. Hurt admitted that Microsoft has to struggle with the idea of whether it is a software company or an internet company.  He also used the term "audience company" but I think one still needs to account for the idea of where one thinks the audience is, and many strategy scholars would see successful strategies as being built on a bet about where the audience is: the desktop or the internet, for example. Raynor points out that the beauty of Microsoft has been that senior management (C-level and above) has created opportunities for developing businesses on both online, desktop, (and mobile, and video game consoles) so that they are not betting one one future shift.  A classic hedge.

See Raynor's book for more detail on how creating strategic options at the highest levels of an organization allows individual business units to focus on committing to a strategy and executing their bold ideas.

Raynor's work deserves more coverage; look for more summaries of his insights in future posts.

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New Category: TheNetwork

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What is the essence of interconnection?  At NextNY's BizDev 2.0 in November 06 there was a great deal of discussion surrounding the ease with which data from one web service can rapidly be incorporated and leveraged into another- the widgetsphere and RSS are great enablers of this- without the need for "slow" business development activity. 

When this is successful it adds value.  Players with market power/lawyers often see this as disruptive "theft"- see myspace/photobucket or the recent "re-peering" of some major Belgian newspapers with Google (which I think we will come to see as just a passing fad in the protectionism of content, but who knows?)

I wrote a few days ago about the similarity of the myspace/photobucket issue to the peering battles between backbone providers.  "Peering" between sites on the internet
is something we take for granted in our web2.0 world, but I think we need to look at it the way backbone providers do, as an exchange of traffic (visitors instead of bits).  Peering may  be free, in the end, only for dominant providers.  At the same time, "dominant" may turn out to not mean much over the long run, and the market power of sites like myspace may  be nicely balanced by user backlash when appropriate.  I'm going to call all my posts about this "TheNetwork" as I examine the interaction between peering and web2.0.


NYT: When the Boss Is Last in Line for a Paycheck

Today's NYT had an interesting snapshot about factors affecting entrepreneurs compensate themselves (balancing between a desire to keep cash in the business and, you know, live).  Some businesses must use balance sheets to secure financing from vendors, others may need it to keep or attract investors/VCs.

However, an  interesting rule of thumb appeared, courtesy of Andrew Corbett, a professor at RPI:

If the business has started to generate some income, the best way to calculate what to pay the owner, Mr. Corbett advised, is to figure out what the job is worth on the open market.
“You want to be true to yourself and to the firm so you don’t want to overpay yourself and you don’t want to shortchange yourself,” he added.
That means looking at what you do day to day and putting your job in one or several categories, for example, sales executive, product developer or general manager. “Calculate how much time you’re working and how much time is spent on each role. Your salary should reflect the work you do.” Ask what it would cost to hire someone else outside of the business to fill that role, he suggested.
The formula he offered includes paying the owner a 30 percent premium over what the open market would pay to cover health benefits and another 20 percent to 30 percent more for the risk. So if a manager or product developer with comparable skills is making $100,000 a year in salary, and that’s mainly what the entrepreneur will be doing, she can expect to pay herself $150,000 to $160,000 a year, Mr. Corbett suggested.

This probably works if the business has revenue, or the market rate in the region isn't buoyed by local living costs, like New York's.  Other entrepreneurs quoted in the article essentially said they had to wait to attract investors before they could pay themselves.